WHEREAS
Granville on the Water Utility Inc., by application filed on April 8, 2008,
applied for interim approval of a schedule of rates and charges for water
services provided to customers of the water system operating in the North
Granville area;

AND WHEREAS the Commission has read
and considered the Utility's application in this matter;

AND WHEREAS it appears to the
Commission that an annual frontage rate of $140.00, combined with an annual flat
rate of $140.00 for serviced water customers are necessary and equitable;

Interim approval
is hereby granted to the Granville Water Utility for the implementation of the
Water Tariff, including the Granville on the Water Utility Inc. Water Rules and
Regulations, appended to, and forming part of, this Order;

2. The
appended Tariff and Rules and Regulations are declared effective on January 1,
2008 and shall remain in effect until otherwise ordered by the Commission;

3. The
provisions of this Order shall remain in effect until otherwise ordered by the
Commission.

12. The Commission may, in its absolute discretion, review, rescind or vary
any order or decision made by it or rehear any application before deciding it.

Parties to this proceeding seeking a review of the Commission's decision or
order in this matter may do so by filing with the Commission, at the earliest
date, a written Request for Review, which clearly states the reasons for the
review and the nature of the relief sought.

Sections 13.(1) and 13(2) of the Act provide as follows:

13.(1) An appeal lies from a decision or order of the Commission to the Appeal
Division of the Supreme Court upon a question of law or jurisdiction.

(2) The
appeal shall be made by filing a notice of appeal in the Supreme Court within
twenty days after the decision or order appealed from and the Civil Procedure
Rules respecting appeals apply with the necessary changes.

1.1
As required by the Water and Sewerage Act, Section 16, the
following Rules and Regulations have been approved by The Island Regulatory and Appeals
Commission for application by all municipal water utilities.

1.2 These
Rules and Regulations are subject to the Water and Sewerage Act
as well as to directives of and special contracts approved by The Island Regulatory and
Appeals Commission.

Part 2
Interpretation

2.1 In these
Rules and Regulations, unless the context otherwise requires, the expression:

Commission
means The Island Regulatory and Appeals Commission.

Customer
means a person, firm or corporation who or which requests or is supplied with water
service at a specific location or locations.

Domestic
Service means the type of water service supplied to the owner or his
authorized agent or to the occupant or tenant of any space or area occupied for the
distinct purpose of a single-family house, each unit of a multiple dwelling, individual
apartment, flat and the like, furnished with separate kitchen facilities provided with
running water.

Due Notice
means the requirement that forty-eight (48) hours written notice be given by the utility
to a customer before any action is taken against the customer for failure to comply with
any of these Rules and Regulations.

General Service
means any type of water service other than domestic service, fire protection service and
municipal service.

Municipality
means the corporation into which the residents of an area have been incorporated as a
municipality.

Service
means water service.

Shall
in the context of these Rules and Regulations means the imperative and that an act must be
done.

Utility
means the water utility of a municipality or service area.

Part 3
General

3.1 Disputes

If any dispute arises
between the Utility and a customer over the interpretation or application of these Rules
and Regulations, either party may refer the matter to the Commission for decision, and the
Commission may, notwithstanding anything contained in these Rules and Regulations, make
such order as it may deem appropriate.

3.2
Application for Service

The Utility may, before
rendering service, require an application form signed by a prospective customer.

3.3
Plumbing Permit

In the case of an owner
of an existing building or premises applying for service, no service shall be provided
until the Utility has been provided with a Certificate of Approval issued by the Plumbing
Inspector.

3.4
Plumbing to be Satisfactory

All plumbing, pipes,
fittings, vents, fixtures and other devices for conveying, distributing, controlling or
utilizing water which are used by a customer and are not the property of the Utility shall
be installed according to the requirements of the current edition of the Canadian
Plumbing Code. Except for construction or testing purposes, the water shall not be
turned on until the applicant for service has satisfied these requirements. The supply of
water may be refused or discontinued to any customer at any time, if, in the opinion of
the Utility, the plumbing, pipes, fittings, vents, fixtures and other devices are herein
before mentioned, or any of them, fail to comply with the above requirements, or if any
part of the water system of such customer is in any unsuitable, dirty, unsanitary or
inaccessible place. Service shall not be re-established until such condition is corrected
to the satisfaction of the Utility.

3.5
Refusal of Service

Service shall be
refused or suspended to any customer who has failed to discharge any of his liabilities to
the Utility.

3.6
Condemned Premises

Services shall be
immediately discontinued to any property condemned under any Federal or Provincial statute
or municipal bylaw.

3.7
Season for Laying Pipe

The Utility shall not,
on application or otherwise, lay any pipe at any season of the year which, in the opinion
of the Utility, is deemed unsuitable for such construction.

3.8
Access to Customer's Premises

Representatives of the
Utility shall have the right of access to a customer's property or premises at all
reasonable hours for the purpose of inspecting any water pipes or fittings, or appliances,
or for the purpose of installing, removing, repairing, reading or inspecting water meters.
The Utility shall have the right to suspend service to any customer who refuses such
access.

Service may be refused
or suspended by the Utility to any customer who installs or uses any device or
appurtenance, as for example: booster pumps, quick-opening or quick-closing valves,
water-operated pumps or siphons, standpipes or large outlets which may occasion sudden
large demands of short or long duration, thereby requiring oversize meters and pipe lines,
or affect the stability or regulation of water pressure in the Utility's system. A permit
to install or use any such device or appurtenance must be obtained from the Utility. The
permit shall specify what special arrangements, such as elevated storage tanks, surge
tanks or equalizing tanks, etc., must be provided by the customer.

3.10
Interference with Utility Property

No person, unless
authorized by the Utility in writing, shall draw water from, open, close, cut, break or in
any way injure or interfere with any fire hydrant, water or main or other property of the
Utility, or obstruct the free access to any hydrant, stop cock, meter, building, etc.,
provided however that nothing in this section shall be deemed to prevent an officer or
member of the Fire Department engaged in the work of such Department, from using any
hydrant or other source of water supply of the Utility for such purpose.

3.11
Improper Use or Waste of Water

No customer shall
permit the improper use or waste of water nor shall he sell or give water to any person
except upon such conditions and for such purposes as may be approved in writing by the
Utility.

3.12
Repair of Leaks

Leaks due to broken
water or sewerage services, worn tap washers, toilet valves or other causes shall be
promptly repaired. If, after being notified, a customer refuses or unduly delays in having
the repairs or alterations made, the Utility may suspend the service if, in its opinion,
such action is necessary to prevent improper use or wastage of the service.

3.13
Cooling Water

Water shall not be used
for cooling purposes by any customer of the Utility except where the system or equipment
to be supplied is of the recirculating conservation type with make-up water only being
added. In the case of refrigeration equipment, including air conditioning systems, no
system having a water consumption rate in excess of 0.50 litres per minute per metric
tonne of capacity shall be provided with cooling water. This Regulation shall apply to all
new installations and to any existing systems if and when they are to be enlarged, renewed
or replaced.

3.14
Suspension of Service for Violation

Whenever, in the
opinion of the Utility, violation of any of these Rules and Regulations is existing or has
occurred, the Utility may cause the service to be suspended from the premises where such
violation is existing or has occurred and may keep the same so suspended until satisfied
that the cause for such action has been removed.

3.15
Suspension of Service

In every case calling
for a suspension of service, due notice must be given to the customer concerned.

3.16
Liability of the Utility

3.16.1 The Utility
shall endeavor to maintain reasonable continuity of service. If the service is
interrupted, the cause of such interruption or other condition shall be removed or
corrected and normal operating conditions restored as soon as possible.

3.16.2 The Utility shall
not be responsible for any damage, direct or consequential, loss or liability that a
customer may sustain by reason of interruption of service, variation of pressure or on
account of the turning off or turning on of the water for any purpose, drawing a vacuum on
the system by fire pumpers, unless caused by the negligence
of the Utility.

3.16.3 Interruptions in
service shall not relieve the customer from any charge for service.

3.17
Jurisdiction of the Utility

The Utility shall have
jurisdiction over all services and extensions including those on a customer's premises up
to the cellar stop, including meters, where applicable, in the case of water service.

Part
4
Services

4.1
Installation of Shut-off

Every water service to
a premises shall have a shut-off valve in an accessible position at the point of entry to
the premises.

4.2
Individual Service

Except with the special
written approval of the Utility, each separate residential building or premises, not
including multiple apartment buildings exceeding two (2) units, shall have a separate
water service with a curb stop.

4.3
Security Deposits

Each applicant for
service may be required to deposit with the Utility a sum of money equal to the estimated
charges for four (4) month's service. The deposit shall be held by the Utility as
collateral security for the payment of its bills. When this deposit is held, at the option
of the Utility, for a period in excess of one (1) year, simple interest at a rate based on
the nearest one-half percent (1/2%) of the bank's prime lending rate as of the first (1st)
banking day of each year shall be credited to the account when refunded. The deposit, less
any amount owed the Utility, shall be returned to the customer after service has been
discontinued and upon the surrender of the deposit receipt.

4.4
Deposits on Custom Work

Whenever a customer
requests that the Utility do work for which such customer is required to pay, and the
Utility agrees to do the work, the Utility may require, before the work is started, a sum
of money equal to the Utility's estimate of the probable cost of the said work. When the
actual cost is determined, an adjustment in payment shall be made. Service shall not be
established or continued by the Utility until all charges are paid.

4.5
Non-Negotiable Cheques

A charge of ten dollars
($10.00) may be made for each non-negotiable cheque.

4.6
Service Pipes

Upon receipt of an
application for service to any premises located on any portion of a street within the
service area of the Utility, which is served by a main water pipe and which premises are
not already provided with service, the Utility shall install or permit to be installed a
water service pipe which it considers to be of a suitable size and capacity. The customer
may engage an independent contractor to install connections which the Utility considers to
be of a suitable size and capacity. No water pipe smaller than 19 mmin diameter
shall be laid for any water service. Any work carried out by an independent contractor for
the customer shall be under the inspection and supervision of the Utility. An inspection
fee of twenty dollars ($20.00) shall apply to work installed by an independent contractor.

4.7
Cost of Service Pipes

In cases where mains
are existing, the cost of supplying and laying a 19 mmwater service pipe and
fittings between the main and the property line of the property to be served shall be paid
by the Utility. From the property line to the premises, the cost shall be paid by the
customer.

4.8
Cost of Oversized Service Pipes

In cases where mains
are existing, for water services larger than 19 mm the whole cost shall be borne by the
customer, less the cost of a 19 mmservice from the main to the property line.

4.9 No
Water Service Without Sewerage Service

Water service shall not
be extended to a premises unless sanitary sewer facilities are also installed or are
presently available to the premises in question.

4.10
Relocation of Service

After service has been
installed by the Utility, no relocation of, or alteration to, the portion of the service
installed shall be made except at the expense of the customer or other persons requesting
such removal or alteration.

4.11
Multiple Service Connections

In the event of more
than one (1) service being required to the same property, such as a sprinkler system
connection or an additional general service connection or connections, the full cost of
the additional services to the system mains, any necessary repairs and maintenance to the
additional services between the main and the customer's premises and any necessary repairs
and replacement to any portion of the streets or sidewalks of the municipality damaged in
providing such additional services shall be paid by the customer. The decision as to the
necessity of the additional services shall be made by the Utility.

4.12
Unauthorized Extensions, Additions or Connections

No person shall,
without the written consent of the Utility, make or cause to be made any connection to any
pipe or main or any part of the water system of the Utility or in any way obtain or use
water therefrom in any manner other than as set out in these Rules and Regulations.

4.13
Cross Connections Prohibited

Connections of any
customer's installation served by the Utility to any other source of water supply is
prohibited, except with the written permission of the Utility with the terms and
conditions of interconnection clearly defined. Failure to comply with this Regulation
shall entitle the Utility to suspend the service.

4.14
Contaminated Interconnection

No connection shall be
permitted to any installation, equipment or source in such a manner as may allow any
contamination to pass from such installation, equipment or source into the Utility's water
supply system. If any such connection exists the Utility may discontinue the supply of
water to such customer.

4.15
Repairs to Service lines

If a leak, stoppage or
other trouble occurs on a water line, it shall be repaired as soon as possible.

The following work shall be
carried out at the expense of the Utility:

(i) Repairs necessitated by
a leak or other trouble occurring between the water main and the property line.

(ii) Repairs necessitated
by a leak or other trouble occurring between the property line and the customer's premises
which has been caused by the installation having insufficient grade or as a result of poor
workmanship.

(iii) Repairs necessitated
by tree roots occurring between the water main and the property line.

The following work shall be
carried out at the expense of the customer:

(i) Repairs necessitated by
normal wear and tear occurring between the property line and the customer's premises.

(ii) Repairs necessitated
by any stoppage attributable to the improper use of the water facilities occurring between
the main and the customer's premises.

(iii) Repairs necessitated
by tree roots occurring between the property line and the customer's premises.

4.16
Private Fire Protection

Fire protection lines
within buildings shall be accessible for inspection, and no connection for any purpose
other than fire protection shall be made thereto. No fire protection line shall be
connected in such a way as to be served through a customer's metered service without the
written permission of the Utility.

4.17
Water for Construction

The Utility may furnish
water to persons requiring a supply thereof for the construction of buildings or other
works. Such persons shall deposit with the Utility such sum as may be determined by the
Utility as sufficient to defray the cost of making the necessary connection to the service
mains, together with the cost of any meter to be installed to measure the water consumed.
Upon completion of the work and return of the meter to the Utility, an adjustment shall be
made after deducting the cost, if any, of repairing the meter and of testing the same, and
after determining the base and connection charges and the consumption rates in respect to
such installation.

4.18 Contracted Work

Where the Utility does not
carry out its own construction, any contract work shall be done for, on
behalf of, and with the approval in writing of the Utility.

4.19 Use of Independent Contractors

In a case where construction
is to be carried out on behalf of the Utility by an independent contractor,
the customer is to be party to any decision relative to accepting any
quotation by the Utility, or alternately, the Utility may allow the
customer to have plans and specifications prepared, and after being approved
the the Utility, an acceptable contractor shall be authorized by the Utility
to proceed with construction under its inspection and supervision. An
inspection fee of twenty dollars ($20.00) shall apply to laterals installed
by an independent contractor.

4.20 Signed Agreements

Where construction is
estimated to cost in excess of one thousand dollars ($1,000.00), a signed
agreement shall be entered into between the Utility and the customer.
Where construction is estimated to cost less than this amount, the Utility
may require a signed agreement between itself and the customer.

Part
5
Billing and Metering

5.1
Payment of Bills

Unless otherwise
ordered by the Commission and subject to anything else in the Rules and Regulations, bills
for all classes of service shall be rendered to each customer monthly,
quarterly, semi-annually or annually, at the option of the Utility. Unmetered customers shall be billed
in advance. All bills shall be payable within thirty (30) days after the date rendered and
if not so paid shall be deemed to be in arrears.

5.2
Prorating of Rates

In the case of a
customer not receiving service for a full billing period, the flat rate or base charge
shall be computed on a pro-rata basis for the period involved.

5.3
Number of Billings

No customer shall be
billed more than twelve (12) minimum charges in any twelve (12) month period.

5.4
Suspension of Service for Non-Payment of Bills

The Utility may suspend
service to unmetered customers whose bills remain unpaid for more than sixty (60) days and
metered customers whose bills remain unpaid for more than thirty (30) days after the date
rendered, provided that due notice is given.

5.5
Curb Stop Charge

In all cases where
service has been discontinued by means of a curb stop for non-payment of bills or on
account or for violation of any section of these Rules and Regulations, service shall not
be restored until all arrears, together with a twenty dollar ($20.00) charge, have been
paid. If turn-off and turn-on is carried out during normal working hours at a customer's
request, a twenty dollar ($20.00) charge will be made, and if not paid, shall be included
in any subsequent bill for service. If turn-off or turn-on of service is requested to be
carried out after normal working hours, the charge for such call out shall be based on
normal charge-out rates for time and equipment involved, but shall not exceed a three (3)
hour charge-out for any one (1) call.

5.6
Delayed Payment Charge

All bills shall be
computed according to the rates fixed by the Commission, and if any bill is not paid
within thirty (30) days after the date rendered, as indicated by the postmark, or such
date as may be clearly shown upon the bill, whichever is the later, it shall be subject to
a delayed payment charge.

The charge shall be equal to two percent (2%) per month of the amount of such
bill, but in no case shall the amount of the penalty be less than twenty-five cents
($0.25).

5.7
Owner of Premises Billed

At the option of the
Utility, charges for service may be billed to the owner of the premises.

5.8
Rates During Vacancy

In the case of a
premises being vacant, the owner shall be billed for the period until the new tenant
becomes responsible for the service.

5.9
Multiple or Joint Use Premises

Billing of multiple or
joint use premises may be carried out either by billing each individual customer according
to the applicable rate schedule or by metering the total premises, at the option of the
Utility.

5.10
Water to be Supplied by Meter

Except when water is
used for construction purposes from a hydrant, under the supervision of the Utility, and
except as otherwise provided in these Rules and Regulations, all service other than that
for Domestic Service and Fire Protection Service shall be metered.

5.11
Meter Size

The Utility shall
determine the size and type of meter to be installed in each case.

5.12
Meter Ownership

All billing for metered
water shall be through meters owned by the Utility.

5.13
Installation and Removal of Water Meters

Water meters shall be
installed and removed only by employees of the Utility, and no other person shall install,
alter, change or remove a meter without the written permission of the Utility. The
connections for such water meters shall be installed to the required standard of, and
without expense to, the Utility.

5.14
Location of Water Meters

The Utility may refuse
service to, or suspend the service of, any customer who does not provide a place which, in
the opinion of the Utility, is suitable for a water meter.

5.15
Meter Protection

Where the premises of a
customer are of such a nature that a water meter cannot be properly installed in a
building or if the building is not sufficiently insulated to ensure the safety of the
meter, the Utility may require the construction of a suitable insulated enclosure in which
the water meter can be installed. Service to such premises may be refused or suspended
until such an enclosure is installed.

5.16
Exterior Reading Meters

If a remote or exterior
reading meter installation is made, at the option of the Utility, the total cost shall be
borne by the Utility. If such an installation is made at the request of the customer, all
costs in excess of regular metering shall be borne by the customer.

5.17
Water Meter Readers

Each Meter Reader or
Utility Inspector shall be provided with a suitable form of identification issued by the
Utility which he shall exhibit upon request.

5.18
Estimated Readings for Billing Purposes

If the Utility is
unable to obtain a water meter reading for billing purposes, after exercising due
diligence in the usual practice of water meter reading, the bill for that service shall be
estimated in accordance with the best data available, subject however to the provision
that, in no circumstance, shall an estimated reading be used for more than two (2)
consecutive billing periods. If an estimated bill is rendered for two (2) consecutive
billing periods, the Utility shall notify the customer by registered mail that
arrangements must be made for the Utility to obtain a reading, and failing such
arrangements, the Utility may suspend service until such arrangements are made. When such
water meter reading has been obtained, the previous estimated bill or bills shall be
adjusted accordingly.

5.19
Disputed Water Meter Accuracy

5.19.1 A customer may
request that his water meter be tested by the Utility.

5.19.2 The Utility employee
shall decide whether the meter will be tested on site or at a testing place.

5.19.3 The Utility may
charge the customer the sum of twenty dollars ($20.00) to defray the cost of removing the
meter, replacing it with another meter tested and sealed by the Utility, and testing the
meter.

5.19.4 If the water meter,
upon testing by the Utility, is within the prescribed accuracy limits of not more than
four percent (4%), the Utility shall retain the customer's deposit.

5.19.5 If the water meter
is found to be outside the prescribed accuracy limits, the Utility shall return the
deposit to the customer and the bill for service rendered to such customer shall be
adjusted accordingly for a period not exceeding six (6) months.

5.20
Damage to Utility's Water Meters and Seals

5.20.1 Every customer
shall be responsible for any damage to the water meter and seal on his premises resulting
from negligence, hot water or steam, the action of frost or from any other cause not the
fault of the Utility or its employees. The cost for any repairs or replacement of the
Utility's water meter or seal shall be borne by the customer.

5.20.2 The Utility's meter
or seal shall not be tampered with or broken by an unauthorized person.

5.20.3 If the Utility's
meter or seal has been broken by an unauthorized person in order that an illegal
connection can be made, the Utility shall disconnect the customer as soon as possible.

5.20.4 If the Utility's
water meter or seal is broken, or the water or sewerage system is tampered with or the
water meter does not register correctly, the bill for that service shall be estimated on
the basis of past consumption in a corresponding period or on the basis of the best data
available.

5.21
Municipal Departments

Water
facilities used by the municipality for any purpose shall be billed to the municipality by
the Utility at the rates and charges established herein and under these Rules and
Regulations.

5.22
Fire Protection Service Charge

The Utility shall
render annually to the municipality an account for fire protection service. Such account
shall be calculated in the manner set out in the Utility's Schedule of Rates.

5.23
Payments Re Adjoining Municipalities

Unless otherwise
ordered by the Commission, customers located in one (1) municipality and receiving service
from another municipality, shall pay charges in accordance with the rates prescribed for
the municipality in which they are located. The utility in the municipality in which such
customer is located shall be billed and be responsible for the payment of charges to the
adjoining utility for such services as may be provided by that utility.